March 2026 Report to the Congress: Medicare Payment Policy

By law, the Medicare Payment Advisory Commission reports to the Congress each March on the Medicare fee-for-service (FFS) payment systems. We evaluate the adequacy of FFS Medicare's payments and make recommendations for how those payments should be updated for 2027. For each recommendation, the Commission presents its rationale, the implications for beneficiaries and providers, and how spending for each recommendation would compare with expected spending under current law. Although we include budgetary implications, our recommendations are not driven by any single budget or financial performance target but instead reflect our assessment of the payment rates needed to ensure adequate access to high-value care for FFS beneficiaries while promoting the fiscal sustainability of the Medicare program. In this report, we make recommendations for FFS payment systems for acute care hospitals, physicians and other health professionals, outpatient dialysis facilities, skilled nursing facilities, home health agencies, inpatient rehabilitation facilities, and hospice providers.

The Commission is also required by law to report to the Congress each March on the Medicare Advantage (MA) program (Medicare Part C) and the Medicare prescription drug program (Part D). In this report, we provide an overview of MA, including recent trends in enrollment, plan availability, and Medicare's payment to plans, and we discuss issues such as MA coding intensity, favorable selection, and Medicare payments and MA plan costs for MA enrollees with end-stage renal disease (ESRD). We also provide a status report on Part D that reviews information on recent trends in enrollment and plan offerings and describes the major changes that have taken place since 2025, as implementation of the Inflation Reduction Act of 2022 (IRA) continues.

In this year's report, we include a chapter on trends and key issues in post-acute care and a status report on ambulatory surgical centers. We also include congressionally mandated reports on the impact of changes to the home health payment system and the performance of special-needs plans for beneficiaries who are dually eligible for Medicare and Medicaid.

In Appendix A, we list all of this year's recommendations and the commissioners' votes.